#048: OpenGov, Analyzing vSaaS vs hSaaS R&D Costs, & Something Not To Do :-)
One vSaaS breakdown. One biz story. One 'how to'. In your inbox once a week.
One Biz Story:
OpenGov
This guy started a BILLION dollar company while living in a shipping container in Kabul, Afghanistan. This "boring" business creates cloud software for government. This is the incredible story of OpenGov:
OpenGov is a cloud software company whose mission is to power more accountable and effective government. They offer a suite of software for public sector accounting, planning, budgeting, citizen services, and procurement. Their products are purpose-built for the sector.
The company was founded in 2012 by Zac Bookman while he was working in Kabul, Afghanistan under General McMaster's corruption task force. His background is insane. He holds a JD from Yale Law, an MPA from Harvard Kennedy, and studied government corruption in Mexico.
Zac teamed up with Nate Levine, Dakin Sloss, & Joe Lonsdale. The group began studying government budgeting in the aftermath of the Great Recession. They started by asking local governments for budget data and found their systems so archaic they couldn't even provide it...
They began by building a reporting & transparency platform that enabled governments to actually access their financial data and share it with the public in an interactive and visual way. The platform also helped governments analyze their own data and compare it with peers.
Their GTM is all about face-to-face sales and relationship building. Big ticket ACV typically translates to this. They eventually acquired their first customer, right in their HQ's backyard, the City of Palo Alto.
Zac says if someone wants to sell software to governments they should be "batshit crazy". That's how hard it is. But they've persevered. After ~10 years they now have 1,500 cities, counties, and state agencies across 49 states. That's really FAST for government.
In vSaaS it's ALL about going multi-product. OpenGov followed this path, expanding its suite to include: -Budgeting and Planning -Accounting and Financial Management -Permitting and Licensing -Procurement -Asset Management
They've been on an acquisition spree with a goal of building a one stop shop, end-to-end vertical SaaS platform for the space. Some of the acquisitions include ProcureNow, a cloud procurement platform, and Cartegraph, a provider of asset management software.
OpenGov is also backed by the best of the best. They've raised over $178 million in funding from investors like Cox Enterprises, Insight Partners, Accel, Andreessen Horowitz, and Emerson Collective. Marc Andreessen even serves on the board...
This is an INCREDIBLE company few talk about. Their vision is to power more effective and accountable government and they are well on their way... By taking government to the cloud they cracked a $1.2 BILLION, as of February 2022, according to PitchBook.
Is an IPO in the near term? I sure hope so... Cheers to @ZacBookman, and the @OpenGovInc team. It's been fun to watch.
One vSaaS Breakdown:
Vertical SaaS vs. Horizontal SaaS R&D Costs:
When you focus on one industry, your R&D costs are typically far less than when you focus on multiple. Vertical > Horizontal SaaS
One ‘How To’:
Don’t Do This…
:)
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